Monday, January 18, 2010
MLK: The Good, the Bad, and the Ugly
The good: Martin Luther King's dream of black equality has been largely realized. Barack Obama's election to the presidency, which required the support of a majority of white Americans, is ample evidence that skin color is no longer the barrier it once was. [Update: This was not actually the case, although Obama did poll at least as well as the past two Democrat candidates for President did among white voters.]
The bad: Said President seems oblivious to the fact that central planning is a form of slavery, and he seeks to impose it on another class of citizens, namely physicians. Neither skin color nor the possession of valuable skills and knowledge justify legalized coercion of individuals.
The ugly: Obama's trip to Massachusetts to shore up support for Martha Coakley indicates that he is unable or unwilling to reconsider his own prejudices against capitalism and, by implication, individualism.
To top all this off: How un-self-aware (or brazen) can someone be to claim that Republicans are "walking in lockstep" even as he campaigns for someone who will do just that with 59 other Democrats to pass a bill that is plainly very unpopular?
Where will they go with this?
Despite my distaste for vendor lock-in, Apple gained my respect when it rewrote its OS on top of a Unix kernel and my interest with its iPhone success. But where will it go with the tablet it's going to release around March? That's the question Farhad Manjoo asks at Slate:
[A rumored price of over $800.00 is] exactly what makes Apple's move so risky. A machine that seeks to supplant a laptop can't offer just a "lean-back" experience -- it's got to let you enter text, too, and that's where tablet machines have long failed. Let's assume that Steve Jobs and his minions have come up with an amazing solution to this problem. In the same way that Apple managed to build an intuitive, easy-to-learn interface into a phone that lacked a physical keyboard, they could figure out a way to make it easy to type long e-mails on a screen that you've got to hold with both hands. But any new system will require a learning curve, and it's likely that some people will never get used to it. Indeed, I still type on my iPhone only grudgingly. When I've got to pen a long e-mail, I wait until I'm near a keyboard.Even if they've found a way to make inveterate keyboard users like myself buy a work computer without a keyboard, they'll have to be prepared for many of us to let the early adopters be the guinea pigs, especially in this economy.
Venezuela on the Precipice
Dismuke points me to an blog posting that predicts national collapse for Venezuela within 120 days based on the unavoidable consequences of Hugo Chavez's gross mismanagement of the power grid.
"National collapse" would be sparked by the forced shutdown of at least 5,000 MW of Venezuela's hydro-power generation capacity.Caracas Gringo goes into more depth on this and other aspects of the situation in Venezuela in this post and elsewhere in his blog.
The lights would go out in large swaths of Venezuela including Caracas for days, weeks, perhaps even for months, according to Edelca's report.
Even worse, [hydroelectric producer] Edelca's best-case forecast is that Venezuela will only barely avoid "national collapse" – assuming that it starts raining by March and the emergency conservation plan launched on 12 January 2010 is effective – but when has the Chavez regime been effective at anything besides destruction, corruption and bullying?
Economist Ambrose Evan-Pritchard thinks that, "2010 will prove to be the year that Japan flips from deflation to something very different:"
Japan's deficits are already within the hyperinflation "red flag" zone identified by historian Peter Bernholz (Monetary Regimes and Inflation ... the Bible on this subject). As you can see from the charts below, prices start to spiral into the stratosphere once the deficits as a share of government expenditure rises above a third and stays there for several years.More there on how Japan may have escaped hyperinflation so far and why it might cease doing so soon.
How have we not had (much) inflation?
I don't know enough about economics to be sure of the soundness of his argument (and wonder how a Japanese collapse would affect it), but Harvard economist Gregory Mankiw explains why he thinks we are not necessarily in store for it.
And as a result of legislative changes in October 2008, the Fed has a new tool: it can pay interest on reserves. With short-term interest rates currently near zero, this tool has been largely irrelevant. But as the economy recovers and interest rates rise, the Fed can increase the interest rate it pays banks to hold reserves as well. Higher interest on reserves would discourage bank lending and prevent the huge expansion in the monetary base from becoming inflationary.Not only does he wonder aloud whether the Fed will use this "new tool," however, he also indicates that the Fed may want to use "a little inflation" to spur the economy. This immediately reminds me of the seventies.
When all is said and done, the value of my bank account remains at the mercy of mere politicians. Color me less than reassured.
The latest is over at Titanic Deck Chairs.
Today: Corrected a factual error.